Qatar seeking to build $1 billion stake in Bank of America

Reuters Staff

3 Min Read

(Reuters) - Qatar’s sovereign wealth fund, one of the world’s most prolific investors, is building a $1 billion holding in Bank of America (BAC.N), seeking to benefit from the U.S. economic recovery, the Financial Times reported, citing sources close to the plans.

Qatar Holding, the investment arm of Qatar Investment Authority (QIA), began buying BofA shares about two years ago, the newspaper said on its website, citing a person close to the fund. The FT added that Qatar had bought more of the bank's shares when their price fell to $7-$8 last year. (link.reuters.com/kas34v)

BofA’s stock closed at $14.17, up 2 cents, on the New York Stock Exchange. A $1 billion stake at this price represents less than 1 percent of BofA, which has a market capitalization of about $151.2 billion, according to Thomson Reuters data.

Under newly appointed Chief Executive Ahmed Al-Sayed, QIA has been on an aggressive expansion spree, hiring bankers and senior executives with experience ranging from mergers and acquisitions in Asia to retail and luxury investments in Europe.

The FT said QIA had hired Michael Cho, a former co-head of Asia mergers and acquisitions at BofA, for a senior role in its mergers and acquisitions department.

Three sources had told Reuters in September that Qatar Holding had hired Ugo Arzani, most recently a BofA managing director in London, as its new head of consumer and retail investments.

The sources had also said that QIA, worth more than $100 billion, was scouting for opportunities in Asia and the United States in a bid to reduce its exposure to Europe and diversify its investment portfolio.

In recent years, QIA has picked up minority stakes in several large global companies such as Royal Dutch Shell (RDSa.L), Tiffany & Co (TIF.N), Siemens (SIEGn.DE), Glencore Xstrata (GLEN.L) and Swiss banking giant Credit Suisse CSGN.VX.

BofA declined to comment and QIA could not be reached for comment outside working hours.